Air Pollution, Government Pollution Regulation, and Industrial Production in China

Posted: 21 Jun 2019

See all articles by Dong Cao

Dong Cao

Xidian Univeristy - School of Economics and Management

Carlos D. Ramirez

George Mason University - Department of Economics

Date Written: June 19, 2018

Abstract

Over the last two decades, a severe deterioration in air quality has accompanied China’s rapid industrialization. As a result, the Chinese government has been implementing stricter air pollution regulations and controls. In this paper, we create a measure of government policies on air pollution by tracking all government pollution-related announcements in Chinese newspapers. We then use this variable, along with measures of actual pollution across five major cities in China to investigate how pollution, industrial production, and the government policies on pollution are interrelated. A vector auto-regression analysis suggests that on the whole level, government policies seem to decrease air pollution without significantly affecting industrial production, but the results appear to be short-lived, dissipating eight months later. But different cities have different relationships among these variables. When there is air quantity decrease, government in city like Beijing seem to have a feedback on this. And government policies seem to decrease air pollution. Governments in cities such as Shanghai and Guangzhou have react to the air pollution. However, government policies seem do not have any effect on air pollution decrease. Governments in cities such as Chengdu and Shenyang have no enough react to the air pollution. And government policies seem do not have any effect on air pollution decrease.

Suggested Citation

Cao, Dong and Ramirez, Carlos D., Air Pollution, Government Pollution Regulation, and Industrial Production in China (June 19, 2018). Abstract Proceedings of 2019 International Conference on Resource Sustainability - Cities (icRS Cities), Available at SSRN: https://ssrn.com/abstract=3406463

Dong Cao (Contact Author)

Xidian Univeristy - School of Economics and Management ( email )

266#, Xifeng Road
Xi'an, Shaanxi 710126
China

Carlos D. Ramirez

George Mason University - Department of Economics ( email )

4400 University Drive
Enterprise Hall MSN 3G4
Fairfax, VA 22030
United States
703-993-1130 (Phone)
703-993-1133 (Fax)

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